The 60-year-old comedian passed away at his home in north-west London after suffering a heart attack, according to his agent Michael Foster.
The news has sent a shockwave through the U.K. comedy scene and a number of Smith's friends and co-stars have expressed their grief in the aftermath of the tragedy.
Smith's longtime collaborator Griff Rhys Jones, who worked with him on Alas Smith and Jones and Not the Nine O'Clock News, says in a statement, "I still can't believe this has happened. To everybody who ever met him, Mel was a force for life. He had a relish for it that seemed utterly inexhaustible. He inspired love and utter loyalty and he gave it in return. I will look back on the days working with him as some of the funniest times that I have ever spent."
Mr. Bean star Atkinson also worked with the late funnyman on Not the Nine O'Clock News, and Smith directed his 1997 movie Bean.
He says in a statement, "Mel Smith - a lovely man of whom I saw too little in his later years. I loved the sketches that we did together on Not the Nine O'Clock News. He was the cast member with whom I felt the most natural performing empathy. He had a wonderfully generous and sympathetic presence both on and off screen... I never thought he was given enough credit for this success. I feel truly sad at his parting."
Stephen Fry adds, "Terrible news about my old friend Mel Smith, dead from a heart attack. Mel lived a full life but was kind, funny and wonderful to know."
Simon Pegg hails Smith as his inspiration, adding in a post on Twitter.com, "Sad to hear about Mel Smith. His influence on contemporary British comedy both as a performer and producer is impossible to calculate."
Pegg's longtime collaborator Nick Frost also mourned Smith's loss in a post on Twitter.com, while tributes have come in from Hollywood actor Jamie Bell, who called his death a great loss to British comedy, along with Richard E. Grant, James Corden, Matt Lucas, director Duncan Jones, and Peter Serafinowicz.
Smith was one of the leading lights of British comedy throughout the 1980s and he also teamed with Griff Rhys Jones to found TalkBack Productions, a Tv company which produced popular comedies including Smack the Pony, Da Ali G Show and I'm Alan Partridge.
He also worked as a writer and director, helming movies including Bean and 2001's High Heels and Low Lifes.
His movie appearances as an actor included roles in The Princess Bride and National Lampoon's European Vacation.